My credit score has been in the low 800's for quite some time...years. Recently I applied online for 0% financing for a Google 5a phone which was approved. Obviously there's going to be a credit inquiry so it was expected. What I didn't expect was a 20 point drop in my score! Really? TWENTY points for a less than $500 purchase? I had no idea that a hard inquiry & approval would be such a wallop. Not complaining really just rather astonished.
I find this rather amazing!
- Thread starter RTexasF
- Start date
What were you expecting?
My score is similar to yours and I track it monthly as a benefit of one of my credit cards.
Mine tends to bounce +/- 15 points occasionally for absolutely no apparent reason.
My score is similar to yours and I track it monthly as a benefit of one of my credit cards.
Mine tends to bounce +/- 15 points occasionally for absolutely no apparent reason.
Part of the score is the amount of available credit you have used. If you pay for a big car repair or appliance or something with your credit card, you can see a ding the next month even if you paid the credit card bill in full.
They look for reasons, and invent reasons to drop your score. I usually ride around the 815-820 range, and one day I got an e-mailed explanation of why my score dropped 20 points, saying that I have insufficient credit utilization. This is because I pay off my credit card 2 days before the invoice cuts. I've always done it, but for unexplained reasons, they sat up and took notice one month.
So, the next cycle, I ran it up with some extra purchases, and waited for the statement to cut before I paid it off. My credit dropped again because of increased credit usage. There's no way to win with the &%$#@!. Just use it to keep an eye out for suspicious activity, and let the rest ride.
So, the next cycle, I ran it up with some extra purchases, and waited for the statement to cut before I paid it off. My credit dropped again because of increased credit usage. There's no way to win with the &%$#@!. Just use it to keep an eye out for suspicious activity, and let the rest ride.
Yeah, if you think about it the "scoring company" may see that as a full credit utilization of a credit line.
$500 purchase on a $500 new credit line may indicate you are tapped out. Still your score is above average and will bounce back. Not judging and not in anyway saying you are tapped out, Im guessing on what the scoring model might see and the results. Keep in mind scoring companies score on ability to pay and for what its worth a 20 post drop would be almost normal, though you maybe have only had a 10 point drop if you got a new credit card with a $15,000 limit and didnt use it or bought a new car for $40,000 but seeking seeking credit for a $500 purchase doesnt look good as far as the general population (not you specifically)
Scoring models are based on an entire population so you can see how that phone purchase might look to a computerized scoring model.
I dont agree that they look for reasons to drop your score, its the last thing they want to do because they want merchants to use and pay for their services, merchants want to make all the loans they can but the scoring companies need to be accurate based on the population as a whole so those merchants dont lose money, the only way to do this is an average of the population and how they behave, not you personally. Also as far as you and a individual, there is no human being calculating your score, no one has it "out" for anyone. Its a computer model, you are just one grain of sand on a beach someplace to them.
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I don't obsess about month to mon credit scores. Anything about 750 is good enough to get the lowest mortgage rates or any credit card you want. Above that is only worth bragging rights. You really don't want to use credit for most things anyway.
I have found that getting the
Here are the factors they consider for your score.
https://www.experian.com/blogs/ask-...ion/score-basics/what-is-a-good-credit-score/
I have found that getting the
Here are the factors they consider for your score.
https://www.experian.com/blogs/ask-...ion/score-basics/what-is-a-good-credit-score/
The last time I pulled a credit report I received conflicting 'tips' on how to improve my score.
One 'tip' said that I had too many credit cards.
Immediately following that 'tip' the next tip said that I wasn't using enough of my credit...
I wonder if they even know what they're looking for.
Credit line was $2500.
I do agree and don't obsess about it. A 20 point drop for a $500 "loan" is just absurd. I simply did not want to put it on a credit card and pay it off in full so I went with +/- $25.00 monthly with no interest for 2 years. I'll pay it off early anyway so no harm no foul.
Darn good question. I doubt that even a seasoned corporate attorney could figure out how our credit rating system works.
Five - seven points maybe, mine varies very little..2-3 points at most. In all honesty I haven't had a "hard" credit check in many years so I didn't know what to expect. Live & learn.
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I paid off my Tundra a few months ago.
With one reporting agency, my score DROPPED by nearly 50 points.
Reason? Account closed/few or no revolving debt accounts.
Really? Paying off a loan, and not having a loan makes me a worse risk?
It's back up now, but the hit was ridiculous both in application and scale.
With one reporting agency, my score DROPPED by nearly 50 points.
Reason? Account closed/few or no revolving debt accounts.
Really? Paying off a loan, and not having a loan makes me a worse risk?
It's back up now, but the hit was ridiculous both in application and scale.
Makes perfect sense. Credit score is how well you pay credit accounts. Once they are all paid off they have no meter to gauge your ability to make timely payments and it eventually makes it non reportable.
a worse risk of them making money. They want debt slaves.
Don't look at your credit score as a judge of your character. If it's good enough to get a not-sub-prime loan, it's good enough.
I accidentally missed a payment once, the unsolicited offers in my mail went through the roof. They want someone that'll rack up the fees and interest.
Hermann
Site Donor 2023
I currently have no installment loans with a fixed payment. The best my Credit Score can be 833. Been stuck there for about a year.
